Ocean<sup>X</sup> blogshttp://oceanx.com/blog
enHow CPGs Can Improve Their Bottom Lines Through Direct to Consumer Subscriptionshttp://oceanx.com/content/how-cpgs-can-improve-their-bottom-lines-through-direct-consumer-subscriptions
<div class="field field-name-field-blog-image field-type-image field-label-hidden"><div class="field-items"><div class="field-item even"><div id="flexslider-1" class="flexslider optionset-default">
<ul class="slides"><li><img typeof="foaf:Image" class="img-responsive" src="http://oceanx.com/sites/default/files/blog/Subscription_Overlays_CPGs.jpg" width="1070" height="346" alt="" title="" /></li>
</ul></div>
</div></div></div><div class="field field-name-body field-type-text-with-summary field-label-hidden"><div class="field-items"><div class="field-item even" property="content:encoded"><p class="MsoNormal">Connecting with and engaging customers: It’s an ongoing struggle many CPGs face. The real problem, however, lies in the way consumer packaged goods companies think about their customers. Most actually think of their customers as the large and small retailers to which they distribute products, rather than the people buying and using those products. That traditional way of thinking — focusing on retailers over buyers — is hard to break.</p>
<p class="MsoNormal">Channel conflict created by selling direct has been around since the launch of e-commerce. For years, many brands, particularly in the retail and electronics industries, chose to focus only on retailers and avoided selling direct. This created openings for digital-first companies to disrupt established players by going where the customers were, while also being able to see higher profit margins. Dell <a href="http://business.time.com/2013/11/14/dell-yes-dell-is-about-to-make-history/" target="_blank">disrupted computers</a>, Warby Parker <a href="http://disruptionmag.com/2016/05/17/dave-gilboa-warby-parker/" target="_blank">disrupted eyewear</a>, and Dollar Shave Club <a href="http://www.wnyc.org/story/dollar-shave-clubs-billion-dollar-deal/" target="_blank">disrupted shaving</a>.</p>
<p class="MsoNormal">Another important factor is the career/compensation structure and history at large and established consumer packaged goods companies. Most CPGs are public and very stable. While that’s a good thing, it also often leads to three-year plans and little room — or motivation — for senior managers to change course or experiment with something unknown, such as selling direct. It is safer to stick with the old and ignore the new.</p>
<p class="MsoNormal"><strong>Amazon Leads CPG in 2017</strong></p>
<p class="MsoNormal">In 2017, many — but not all — CPGs have websites that allow customers to order products direct. These efforts, though, rarely lead to significant results because they were done as an afterthought with very little marketing or concern for the end customer experience. Direct sales of 1 percent to 2 percent of overall sales are the disappointing reality for most CPGs.</p>
<p class="MsoNormal">With these sales numbers, it’s easy to conclude that direct selling doesn’t work. But because most of these organizations’ media budgets are allocated to brand general advertising instead of selling direct, direct selling often isn’t given a chance to succeed.</p>
<p class="MsoNormal">Many CPGs are trying to break into the digital world, with 20 percent of consumer packaged goods sales now happening online. However, the lion’s share of that goes to Amazon and the rest to other large retailers such as Walmart, Target, and Jet.com. Some CPGs are even starting to pay Amazon to advertise their products to stand out on Amazon. So in essence, Amazon gets paid twice on the sale and owns the important customer relationship as it becomes a huge digital media channel.</p>
<p class="MsoNormal">In 2016, <a href="http://adage.com/article/ad-age-annual/cpg-e-commerce-sales-soared-42-year-driven-amazon-subscriptions/302405/" target="_blank">CPG e-commerce sales increased 42 percent</a>, mostly driven by Amazon subscription sales. It’s becoming more obvious and no longer deniable that Amazon, with its increasingly powerful machine, eats everybody’s cake and simply kills all other forms of retail.</p>
<p class="MsoNormal">Because they’ve sold through retailers for decades, most consumer packaged goods companies don’t actually know who their customers are. Amazon does, and that’s why CPGs have to win back their customers — because Amazon will not look out for a specific brand. Rather, it will drive prices down and put CPGs under pressure.</p>
<p class="MsoNormal"><strong>Gaining Back Customers</strong></p>
<p class="MsoNormal">Selling direct needs to be funded and executed by leaders educated in direct sales, and it needs to be taken seriously. This starts by creating a division within the company that’s solely dedicated to increasing direct sales, then giving that division the marketing budget to establish real relationships with customers. However, because building internal expertise takes time, other options include purchasing or partnering with an established direct seller. Take, for instance, when Unilever <a href="https:/www.nytimes.com/2016/07/20/business/dealbook/unilever-dollar-shave-club.html?_r=0&amp;quot;" target="_blank">purchased direct seller startup</a> Dollar Shave Club for about $1 billion in 2016.</p>
<p class="MsoNormal">Dollar Shave Club built a disruptive brand with deep and loyal connections to its customers, and in turn, those customers were highly engaged. In other words, the startup had conquered the direct-to-consumer space within its industry. By taking over the brand, Unilever was able to harness those insights and take advantage of Dollar Shave Club’s strong customer bonds while learning from its experience.</p>
<p class="MsoNormal">To win back their customers from the e-commerce giants and retailers, CPGs must learn how to engage and resonate with those customers. And as startups such as Dollar Shave Club continue to disrupt the market and reach buyers on a deeper level, it will be more important than ever for CPGs to engage with their audiences.</p>
<p class="MsoNormal">Are you a CPG leader who wants to find a way to compete with Amazon? Check out the OceanX platform and <a href="http://www.oceanx.com/request-demo">schedule time to talk with a membership expert</a>. </p>
</div></div></div><div class="field field-name-field-category field-type-taxonomy-term-reference field-label-inline clearfix"><h3 class="field-label">Category: </h3><ul class="links inline"><li class="taxonomy-term-reference-0"><a href="/blog-category/customer-success" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Customer Success</a></li><li class="taxonomy-term-reference-1"><a href="/blog-category/new-membership-economy" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">New Membership Economy</a></li><li class="taxonomy-term-reference-2"><a href="/blog-category/subscription-strategy" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Subscription Strategy</a></li></ul></div>Thu, 27 Jul 2017 19:54:55 +0000Jeff Miller476 at http://oceanx.comhttp://oceanx.com/content/how-cpgs-can-improve-their-bottom-lines-through-direct-consumer-subscriptions#commentsTesting Budgets in the New Membership Economy: LinkedIn Articlehttp://oceanx.com/content/testing-budgets-new-membership-economy-linkedin-article
<div class="field field-name-field-blog-image field-type-image field-label-hidden"><div class="field-items"><div class="field-item even"><div id="flexslider-2" class="flexslider optionset-default">
<ul class="slides"><li><img typeof="foaf:Image" class="img-responsive" src="http://oceanx.com/sites/default/files/blog/testing_budgets_linked2.jpg" width="1070" height="346" alt="" title="" /></li>
</ul></div>
</div></div></div><div class="field field-name-body field-type-text-with-summary field-label-hidden"><div class="field-items"><div class="field-item even" property="content:encoded"><p>OceanX CEO &amp; Founder, <a href="https://www.linkedin.com/in/georg-richter-1287473/" target="_blank">Georg Richter</a>, answers one of the most common questions that we get around what kind of budget it takes to launch and scale a successful subscription program in the New Membership Economy. This article was originally posted on <a href="https://www.linkedin.com/pulse/testing-budget-subscriptions-reality-check-georg-richter" target="_blank">LinkedIn</a>.</p>
<p>You’d be hard-pressed to find someone who isn’t hooked on at least one physical subscription service (a box subscription) these days. From Harry’s to FabFitFun, <a href="https://www.inc.com/christina-desmarais/heres-data-showing-the-crazy-growth-of-subscription-box-services-infographic.html&amp;quot;">subscriptions are undoubtedly hot</a>, and the industry is ripe for continued innovations and evolution.</p>
<p>That said, subscriptions aren’t necessarily a new trend. After all, phone, cable TV, and other utilities have long been subscription-based services. But this tried-and-true business model is undergoing a renaissance across industries. Birchbox, Dollar Shave Club, Stitch Fix, and 3,000 other physical subscription businesses add to what we call ‘The New Membership Economy’. At the same time, brick-and-mortar retail is getting increasingly more competitive, with direct sellers via subscriptions and Amazon accelerating this trend.</p>
<p>Today, the concept of subscriptions is discussed in nearly every company boardroom. Yes, there are limits and <a href="http://www.oceanx.com/content/4-products-don%E2%80%99t-need-subscription-programs" target="_blank">not all products should be sold via subscriptions</a>, but many products — from packaged goods to apparel to food — are moving toward subscriptions.</p>
<p>My company, OceanX, is in the business of helping companies set up successful subscriptions. We focus on consumer products that ship to subscribers, as opposed to more digitally focused subscriptions that comprise what has been labeled as the “subscription economy.” Retailers and brands often ask us one key question: How much does it cost to set up and run a successful subscription? A simple question to a complex topic.</p>
<h2>The Cost Elements of a Subscription Model</h2>
<p>I’ll explain the basics here, but it’s important to set the right expectations. If you’re a single entrepreneur or a small company and have limited expectations regarding size of your direct selling business, a subscription model can be relatively inexpensive to launch and test. There are simple tools and systems to play around with, but you will have considerable challenges to scale your business. However, if you are a well-known brand or retailer, it will cost serious money to successfully test a new vertical and potential media strategy for your business. The investment will be sizable and so will the potential gain.</p>
<p>Just like opening a new retail store location or taking on a new large account, it takes resources — mainly money and people — to successfully launch and test a new subscription sales channel. But doing so successfully can provide your business with recurring revenue and allow you to establish real relationships with customers.</p>
<p><strong>Here are five essential cost elements to consider:</strong></p>
<p><strong>Demand creation:</strong> Setting up a website and waiting for the subscribers to roll in won’t work out in your favor. Getting a channel going requires significant investments in marketing and media. Where you market and how you test will be based on your product category, your business metrics, and what you’re comfortable with. It might be best to test with digital vs TV or social media vs influencer marketing. The key is to plan for enough marketing so you can test your CPA (cost per acquisition) and to spend enough time measuring the LTV (Life Time Value) of your members. This way, you can gather insight and apply it to a working subscription financial model to calculate ROI, make adjustments and grow. 20%-30% of anticipated gross sales should go to the demand creation bucket.</p>
<p><strong>Inventory:</strong> This is the second biggest expense bucket. Ideally, the merchandise is exclusive (at least partially) and offers subscribers something new and interesting. It needs to be also be something that people will need or want on a recurring basis. You need to understand your cost of goods (at various levels of production). About 20% of sales should generally be spent on inventory in order for margins to work out long-term.</p>
<p><strong>Postage &amp; Fulfillment:</strong> In 2017, <a href="http://marketingland.com/e-commerce-report-9-10-consumers-say-free-shipping-no-1-incentive-shop-online-180280" target="_blank">people expect free shipping</a>, and delivering on that expectation adds significant cost to the P&amp;L. Postage is a factor of weight, speed, and location and must be included from the very start. Fulfillment is a factor of the number and types of products and collateral in the box as well as how you want the unboxing experience to be. It is cheaper to ‘just throw’ products into a brown box (Amazon model) than to create an unboxing experience that promotes your brand, showcases your products and encourages members to share that experience with others.</p>
<p><strong>Subscription platform provider(s):</strong> At a minimum you need a payment processor, a subscription shopping cart, a distribution provider and customer service. Ideally, all these services can be purchased in a bundle — not only for cost efficiency, but also for data integrity. Database building and deep reporting as well as precise execution are essential for success. An integrated platform that connects the data (live) lets you make smart decisions, saves money and many headaches.</p>
<p><strong>Dedicated management:</strong> Opening a new channel requires leadership and top management support. Effective project management is a key ingredient in a winning formula.</p>
<p>Just like starting any other channel, you need significant resources to launch and scale a successful subscription business in the New Membership Economy. However, with solid planning and competent partner selection, you can safely establish a truly successful channel. Ignoring the many mom and pop businesses which will never reach scale, I would suggest a minimum budget of several hundred thousand for smaller companies, and larger companies should set aside at least $1 million. It may seem like a lot of money (and it is), but this investment is truly inexpensive compared to starting a retail operation. The beauty of subscriptions is in connecting with your customers over the long haul so make sure you set aside enough capital to give your test a true chance to succeed.</p>
</div></div></div><div class="field field-name-field-category field-type-taxonomy-term-reference field-label-inline clearfix"><h3 class="field-label">Category: </h3><ul class="links inline"><li class="taxonomy-term-reference-0"><a href="/blog-category/new-membership-economy" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">New Membership Economy</a></li><li class="taxonomy-term-reference-1"><a href="/blog-category/subscription-strategy" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Subscription Strategy</a></li></ul></div>Thu, 27 Jul 2017 19:40:54 +0000OceanX471 at http://oceanx.comhttp://oceanx.com/content/testing-budgets-new-membership-economy-linkedin-article#comments3 Lessons CPGs Should Learn From Amazon Prime Dayhttp://oceanx.com/content/3-lessons-cpgs-should-learn-amazon-prime-day
<div class="field field-name-field-blog-image field-type-image field-label-hidden"><div class="field-items"><div class="field-item even"><div id="flexslider-3" class="flexslider optionset-default">
<ul class="slides"><li><img typeof="foaf:Image" class="img-responsive" src="http://oceanx.com/sites/default/files/blog/Subscription_Overlays_amazon.jpg" width="1070" height="346" alt="" title="" /></li>
</ul></div>
</div></div></div><div class="field field-name-body field-type-text-with-summary field-label-hidden"><div class="field-items"><div class="field-item even" property="content:encoded"><p>Amazon Prime Day 2017 this week, which this year lasted 30 hours this year, generated an <a title="Digital Commerce" href="https://www.digitalcommerce360.com/2017/07/12/amazon-approaches-3-billion-sales-prime-day/" target="_blank">estimated $2.88 billion in sales which is 60% more than 2016</a> and <a title="Bloomberg" href="https://www.bloomberg.com/news/articles/2017-07-12/amazon-s-prime-day-proves-to-be-biggest-shopping-day-ever" target="_blank">$1B in revenue</a>. These massive numbers don’t even take into account how much Amazon made off advertising on the site during the day or the recurring revenue and increased LTV they will generate from the massive amount of new Prime members who joined Prime on their biggest acquisition day in Prime's history.</p>
<p>Many lists of lessons learned and recaps of top products sold and total dollars sold from Amazon’s biggest sales day ever are already circulating. We thought we would jump into the mix with three lessons that CPGs should learn from Amazon Prime Day 2017.</p>
<h2>Amazon Alexa is Growing and CPGs Should be Very Scared</h2>
<p>The biggest selling product this year was the Amazon Alexa Dot. It was discounted and was a key deal offered for Alexa owners throughout the day. According to Amazon, the Dot was not only the biggest Amazon branded product but also the best-selling product from any manufacturer in any category across Amazon globally. Why should CPGs be worried about a voice-activated helper that plays music, turns on the lights and makes kids laugh with funny stories and answers? The answer is simple- Alexa and similar devices from Google and others will start to dominate simple online shopping and as it stands now, <strong>Alexa does not care about your brand or product at all</strong>. </p>
<p>“Nearly 70% of the Alexa-only Prime Day Deals were for CPG products, from candy to home consumables such as paper towels and toilet paper,” points out Ryne Misso, Director of Marketing for Market Track, on <a title="Retail Wire" href="http://www.retaildive.com/news/5-takeaways-from-amazon-prime-day-2017/446919/" target="_blank">Retail Wire</a>. Voice is different than desktop and mobile shopping as choice is limited based on what Alexa thinks you want, how long you want to listen to her and what is best for Amazon. What is best for Amazon now includes more private label brands (see lesson 2) or the product they make the best margin on based on who it is sold from and where it is shipped from. </p>
<p>If you are not already thinking about voice, try to order batteries with Alexa. Your only choice is Amazon Basics and long time market leaders Duracell and Energizer are nowhere to be found unless you explicitly state the exact brand name you want, which is becoming less and less common. Younger shoppers are looking for what the product does for them, what the ingredients are, and what it is. They are not searching for brands or asking Alexa for brands that we often associate with product categories as much as other generations.</p>
<p>So more voice activated devices + less choice + Amazon not caring about your brand of toilet paper, tooth paste or even chocolate = big trouble for CPGs who don't adapt.</p>
<h2>Amazon Private Label and Branded Products Taking Larger Share</h2>
<p>According to marketing technology company Amobee in the same article in <a href="http://www.retaildive.com/news/5-takeaways-from-amazon-prime-day-2017/446919/" target="_blank">Retail Dive</a> “In 2016, only three of the 10 products most associated with Prime Day in digital content engagement were proprietary. But by midday of the 2017 event, five of the 10 products most associated with Prime Day were Amazon-branded items.” We do not know which products yet but it safe to assume that known products like Alexa and Kindle made the list and possibly Amazon Basics like batteries. It will be interesting to see if Amazon releases numbers on any of their new private label brands or categories like the dozen new apparel brands that seemed to be featured during much of the day for generic clothing searches.</p>
<p>Amazon is not shy about entering new categories to try private label. We would not be shy either if we had unlimited access to cheap capital from Wall Street who only care about growth. Since Amazon knows the customer best and owns the customer relationship, the only long term play that other brands in the same space can use to compete for that customer on Amazon will be to spend marketing dollars on Amazon to compete with products created by Amazon. Amazon is quickly becoming the 3rd largest digital advertising platform behind Google and Facebook and brands will have to start to put more media dollars and raise bids to stand out from competitors including upstart brands who know the game better and Amazon themselves. This looks like a vicious circle and a race to the bottom for brands in the spaces where Amazon enters with quality private labels.</p>
<h2><strong>Prime Day 2017 is Only the Start</strong></h2>
<p>Yes, July 11 2017 and the 6 hours before it made for a huge day for Amazon and that alone should mean something. But as mentioned before, they now have millions more Prime members for the other 364 days of the year. With the success this year and growth year over year, we can expect Prime Day 2018 to be even bigger. Amazon is not the only game in town for these kind of massive promotions. China’s Alibaba is the real creator of this promotion and they have not even scraped the surface of US or other regions with its Singles Day in November. Last year, <a href="https://www.forbes.com/sites/franklavin/2016/11/15/singles-day-scorecard-a-day-in-china-now-bigger-than-a-year-in-brazil/#2ebd04da1076" target="_blank">Alibaba’s Singles Day brought in $17.8 billion is sales</a>, 6X what Amazon did and more than Brazil’s total 2016 e-commerce sales. Will Wal-Mart, Jet.com, Target or any of the others follow Amazon who followed Alibaba for these one day sales events? </p>
<p>So what can CPGs do with these three lessons and probably a dozen more they should consider? We think the solution is simple to articulate but more difficult to execute. They need to start to take some of the customer relationship back from giants like Amazon. The ship may have sailed on competing with Amazon in e-commerce as they have such a huge lead unless you are another giant like Wal-Mart, Target or Alibaba. However, the boat has not left the dock for brands to use customer centric subscriptions and well executed memberships programs to use the brand equity they have built over time, before it erodes, to give consumers a better experience than the value, convenience and selection of Amazon. </p>
<p>Are you a CPG leader who wants to find a way to compete with Amazon? Check out the OceanX platform and <a href="http://www.oceanx.com/request-demo">schedule time to talk with a membership expert</a>. </p>
</div></div></div><div class="field field-name-field-category field-type-taxonomy-term-reference field-label-inline clearfix"><h3 class="field-label">Category: </h3><ul class="links inline"><li class="taxonomy-term-reference-0"><a href="/blog-category/new-membership-economy" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">New Membership Economy</a></li></ul></div>Thu, 13 Jul 2017 23:12:42 +0000OceanX466 at http://oceanx.comhttp://oceanx.com/content/3-lessons-cpgs-should-learn-amazon-prime-day#commentsEntrepreneur Article: How to Use Data to Stem the Tide of High Churn in Subscriptionshttp://oceanx.com/content/entrepreneur-article-how-use-data-stem-tide-high-churn-subscriptions
<div class="field field-name-field-blog-image field-type-image field-label-hidden"><div class="field-items"><div class="field-item even"><div id="flexslider-4" class="flexslider optionset-default">
<ul class="slides"><li><img typeof="foaf:Image" class="img-responsive" src="http://oceanx.com/sites/default/files/blog/data_sized.jpg" width="1070" height="357" alt="" title="" /></li>
</ul></div>
</div></div></div><div class="field field-name-body field-type-text-with-summary field-label-hidden"><div class="field-items"><div class="field-item even" property="content:encoded"><p>This article was written by OceanX CEO and Founder Georg Richter and first published on <a href="https://www.entrepreneur.com/article/296335" target="_blank">Entrepreneur.com</a>.</p>
<p>Subscriptions are still growing and innovating, with the subscription box industry projected to create $40 billion in revenue this year, according to Subscription Summit organizers.</p>
<p>Of course, that means a fair amount has been written about subscriptions, even more perhaps specifically about the value of data and analytics in the world of subscriptions. But most of that information targets the ways data and analytics can fine-tune customer acquisition and inform decisions around price or products. Acquisition is only half the battle. The understanding of customer behavior and retention data are key for establishing a profitable business. Churn -- when customers leave a subscription program -- is to be expected. But plenty of newcomers to the space are shocked when they see real churn rates, and they don’t know what data can help them make decisions to successfully battle it.</p>
<p>Read the full article <a title="Entrepreneur" href="https://www.entrepreneur.com/article/296335" target="_blank">here</a>.</p>
</div></div></div><div class="field field-name-field-category field-type-taxonomy-term-reference field-label-inline clearfix"><h3 class="field-label">Category: </h3><ul class="links inline"><li class="taxonomy-term-reference-0"><a href="/blog-category/business-intelligence" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Business Intelligence</a></li><li class="taxonomy-term-reference-1"><a href="/blog-category/new-membership-economy" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">New Membership Economy</a></li><li class="taxonomy-term-reference-2"><a href="/blog-category/subscription-strategy" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Subscription Strategy</a></li></ul></div>Thu, 06 Jul 2017 22:48:08 +0000OceanX461 at http://oceanx.comhttp://oceanx.com/content/entrepreneur-article-how-use-data-stem-tide-high-churn-subscriptions#commentsWhen Is the Right Time to Break the Credit Card Chain? Try Neverhttp://oceanx.com/content/when-right-time-break-credit-card-chain-try-never
<div class="field field-name-field-blog-image field-type-image field-label-hidden"><div class="field-items"><div class="field-item even"><div id="flexslider-5" class="flexslider optionset-default">
<ul class="slides"><li><img typeof="foaf:Image" class="img-responsive" src="http://oceanx.com/sites/default/files/blog/credit_card_b2b.jpg" width="1070" height="346" alt="" title="" /></li>
</ul></div>
</div></div></div><div class="field field-name-body field-type-text-with-summary field-label-hidden"><div class="field-items"><div class="field-item even" property="content:encoded"><p>This article was written by OceanX CEO and Founder <a title="Georg Richter LinkedIn" href="https://www.linkedin.com/in/georg-richter-1287473/" target="_blank">Georg Richter</a> and first published on <a href="http://www.business2community.com/ecommerce/right-time-break-credit-card-chain-try-never-01867428#Q3cz1c435cOxs8S9.97" target="_blank">Business2Community.com</a>.</p>
<p>A cardinal rule when it comes to online subscription sales: Never cancel a subscription order because a payment card transaction fails.</p>
<p>Cards are declined for many reasons. They expire, they get stolen, they fall out of back pockets, and, yes, customers often exceed their spending limits. But breaking the chain of transactions with a customer will break your bottom line.</p>
<p>Fortunately, decision makers who are facing recurring payment failures can implement certain strategies that will allow them to continue shipping and that will ensure high lifetime customer value.</p>
<p><strong>Read the <a href="http://www.business2community.com/ecommerce/right-time-break-credit-card-chain-try-never-01867428#Q3cz1c435cOxs8S9.97" target="_blank">full article here</a>.</strong></p>
</div></div></div><div class="field field-name-field-category field-type-taxonomy-term-reference field-label-inline clearfix"><h3 class="field-label">Category: </h3><ul class="links inline"><li class="taxonomy-term-reference-0"><a href="/blog-category/customer-success" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Customer Success</a></li><li class="taxonomy-term-reference-1"><a href="/blog-category/new-membership-economy" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">New Membership Economy</a></li><li class="taxonomy-term-reference-2"><a href="/blog-category/subscription-strategy" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Subscription Strategy</a></li></ul></div>Mon, 26 Jun 2017 16:42:00 +0000Georg Richter456 at http://oceanx.comhttp://oceanx.com/content/when-right-time-break-credit-card-chain-try-never#commentsLinkedIn Article: Inventory Management Is Key to Subscription Successhttp://oceanx.com/content/linkedin-article-inventory-management-key-subscription-success
<div class="field field-name-field-blog-image field-type-image field-label-hidden"><div class="field-items"><div class="field-item even"><div id="flexslider-6" class="flexslider optionset-default">
<ul class="slides"><li><img typeof="foaf:Image" class="img-responsive" src="http://oceanx.com/sites/default/files/blog/Subscription_Overlays_5-Inventory.jpg" width="1070" height="346" alt="" title="" /></li>
</ul></div>
</div></div></div><div class="field field-name-body field-type-text-with-summary field-label-hidden"><div class="field-items"><div class="field-item even" property="content:encoded"><p>OceanX CEO &amp; Founder <a href="https://www.linkedin.com/in/georg-richter-1287473/" target="_blank">Georg Richter</a> recent LinkedIn article explaining through the lens of a POPSUGAR email he received the importance of inventory management in the subscription world.</p>
<p>Excerpt "Today, I received an interesting email notification from POPSUGAR that my “June Must Have Box may be arriving at your doorstep a little later than usual.” The box is delayed, according to the email, because they are waiting for one item in the line-up that did not make it to their warehouse in time."</p>
<p>Read the full article <strong><a href="https://www.linkedin.com/pulse/inventory-management-key-subscription-success-georg-richter" target="_blank">here</a>.</strong></p>
</div></div></div><div class="field field-name-field-category field-type-taxonomy-term-reference field-label-inline clearfix"><h3 class="field-label">Category: </h3><ul class="links inline"><li class="taxonomy-term-reference-0"><a href="/blog-category/subscription-strategy" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Subscription Strategy</a></li></ul></div>Fri, 16 Jun 2017 22:13:17 +0000OceanX451 at http://oceanx.comhttp://oceanx.com/content/linkedin-article-inventory-management-key-subscription-success#commentsTwo New Interesting Twists on the New Membership Economyhttp://oceanx.com/content/two-new-interesting-twists-new-membership-economy
<div class="field field-name-field-blog-image field-type-image field-label-hidden"><div class="field-items"><div class="field-item even"><div id="flexslider-7" class="flexslider optionset-default">
<ul class="slides"><li><img typeof="foaf:Image" class="img-responsive" src="http://oceanx.com/sites/default/files/blog/Subscription_Overlays_13.jpg" width="1070" height="346" alt="" title="" /></li>
</ul></div>
</div></div></div><div class="field field-name-body field-type-text-with-summary field-label-hidden"><div class="field-items"><div class="field-item even" property="content:encoded"><p class="MsoNormal">The New Membership Economy continues to innovate at a rapid and fun to be a part of pace. Current subscription leaders like Birchbox are opening brick and mortar stores, Le Tote just launched a new private label line with a key influencer, Gap launched a Baby Outfit box while other new brands are entering the space. </p>
<p class="MsoNormal">Two subscription brands recently caught my eye. Both focus on “organics” and combine a mix of high impact branding, good looking and unique products and the power of subscriptions. One is brand new and looking to disrupt a $55B market and the other is an over 25 year old brand who recently started to focus their direct to consumer sales on subscriptions. I look forward to seeing how they both enter the market and establish themselves.</p>
<p class="MsoNormal"><a href="https://helloyumi.com/"><strong>Yumi: Organic Baby Food Subscriptions</strong></a></p>
<p class="MsoNormal">Yumi is the brainchild of Goldman Sachs alumni Angela Sutherland and business journalist Evelyn Rusli. They worked with pediatricians, chefs and nutritionists to create and now sell via subscriptions a new organic baby food that they quote is “finally good enough to eat”. Yumi just launched on June 13th and is only available in California for now with first shipments looking like they will arrive in the first few weeks of July if ordered today. </p>
<p class="MsoNormal">Yumi will deliver meals weekly to customers' doors, making it more convenient and less time-consuming than putting together food at home and a potentially healthier but more expensive option than much of the other organic baby food in the market.</p>
<p class="MsoNormal">The Yumi website, content and product imagery are elegant and on brand. The site follows a similar path and feel to other successful meal delivery subscription programs like Hello Fresh, Thistle and Blue Apron.</p>
<p class="MsoNormal">It will be interesting to see how Yumi and other subscription based baby food platforms like Thistle Baby compete or disrupt the $55 billion market. The baby food market includes: large established brands like Gerber and organic brands like Plum Organics; large online retailer like Amazon who offer most baby foods via Subscribe and Save; large omni-channel retail chains like Wal-Mart, Target and Whole Foods; and other meal delivery brands like Blue Apron who will also be looking at the baby market as a way to expand.</p>
<p class="MsoNormal"><a href="https://www.coyuchi.com/subscribe"><strong>Coyuchi: Organic Bedding You Can Recycle</strong></a></p>
<p class="MsoNormal">Organix linen company Coyuchi has been around since 1991 but just recently started to focus its direct to consumer sales to a more subscription focused model called Coyuchi For Life. Running at either $5 or $7 a month subscribers can get new organic sheets, duvets and/or towels delivered every six, 12 or 24 months. Then to avoid waste all used linens can be returned and depending on their condition will be recycled or for fabrics that still have some life laundered in a process that uses carbon dioxide instead of dry cleaning solvents to sell secondhand. </p>
<p class="MsoNormal">The idea according to Eileen Mockus, Coyuchi CEO is a sustainable circular subscription which allows “customers to engage in long-term way around sustainability”. Very few people think about recycling their linens aside from maybe donating them to the Goodwill. By building in recycling into the actual processes of subscription program from the start gives Coyuchi a different angle than other competitors like Brooklinen and Parachute who seemed to have followed the direct to consumer success of mattress brands like Casper and Purple.</p>
<p class="MsoNormal">We love seeing new and creative entrepreneurs who want to tackle a new challenge and see subscriptions as a way to accomplish their goals. Connect with an OceanX membership expert to learn more tips on subscriptions and the powers of membership at <a href="http://www.oceanx.com/request-demo" target="_self">www.oceanx.com/request-demo</a>.</p>
</div></div></div><div class="field field-name-field-category field-type-taxonomy-term-reference field-label-inline clearfix"><h3 class="field-label">Category: </h3><ul class="links inline"><li class="taxonomy-term-reference-0"><a href="/blog-category/new-membership-economy" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">New Membership Economy</a></li></ul></div>Fri, 16 Jun 2017 21:33:23 +0000OceanX446 at http://oceanx.comhttp://oceanx.com/content/two-new-interesting-twists-new-membership-economy#commentsVideo: The Psychology of Physical Subscriptionshttp://oceanx.com/content/video-psychology-physical-subscriptions
<div class="field field-name-field-blog-image field-type-image field-label-hidden"><div class="field-items"><div class="field-item even"><div id="flexslider-8" class="flexslider optionset-default">
<ul class="slides"><li><img typeof="foaf:Image" class="img-responsive" src="http://oceanx.com/sites/default/files/blog/Subscription_Overlays_10.jpg" width="1070" height="346" alt="" title="" /></li>
</ul></div>
</div></div></div><div class="field field-name-body field-type-text-with-summary field-label-hidden"><div class="field-items"><div class="field-item even" property="content:encoded"><p class="MsoNormal">Experts often cite that there are three core elements of a successful subscription businesses- convenience, value and replenishment. We agree that these three are important and in some cases are the only elements you need for certain product categories, especially ones widely available via Amazon Subscribe and Save. However, in the New Membership Economy we argue that innovative brands and retailers should consider 12 key psychology elements of physical subscriptions when thinking about creating a true membership experience.</p>
<p class="MsoNormal">In this latest video, OceanX CEO and Founder, Georg Richter breaks down the Psychology of Physical Subscriptions and outlines the 12 key elements while providing examples of brands who are using some of these techniques.</p>
<p><iframe src="https://player.vimeo.com/video/215421478" frameborder="0" width="640" height="360"></iframe></p>
</div></div></div><div class="field field-name-field-category field-type-taxonomy-term-reference field-label-inline clearfix"><h3 class="field-label">Category: </h3><ul class="links inline"><li class="taxonomy-term-reference-0"><a href="/blog-category/new-membership-economy" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">New Membership Economy</a></li><li class="taxonomy-term-reference-1"><a href="/blog-category/subscription-strategy" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Subscription Strategy</a></li></ul></div>Wed, 31 May 2017 00:05:32 +0000OceanX441 at http://oceanx.comhttp://oceanx.com/content/video-psychology-physical-subscriptions#commentsVideo: Recurring Revenue Conference Panelhttp://oceanx.com/content/video-recurring-revenue-conference-panel
<div class="field field-name-field-blog-image field-type-image field-label-hidden"><div class="field-items"><div class="field-item even"><div id="flexslider-9" class="flexslider optionset-default">
<ul class="slides"><li><img typeof="foaf:Image" class="img-responsive" src="http://oceanx.com/sites/default/files/blog/video_recurring_rev.jpg" width="1070" height="346" alt="" title="" /></li>
</ul></div>
</div></div></div><div class="field field-name-body field-type-text-with-summary field-label-hidden"><div class="field-items"><div class="field-item even" property="content:encoded"><p style="text-align: left;">OceanX was proud to be a sponsor and participant at the<a href="http://www.recurringrevenueconference.com/" target="_blank"> Recurring Revenue Conference</a> presented by Sutton Capital Partners this year. The event had a wide mix of quality people from all across the worlds of subscriptions. OceanX Founder and CEO, Georg Richter, helped kick off the event with a panel on how to scale a subscription business along with Bill Bradford from Beachbody. See the below video and we look forward to next year.</p>
<p><iframe src="https://player.vimeo.com/video/219021049" frameborder="0" width="640" height="360"></iframe></p>
</div></div></div><div class="field field-name-field-category field-type-taxonomy-term-reference field-label-inline clearfix"><h3 class="field-label">Category: </h3><ul class="links inline"><li class="taxonomy-term-reference-0"><a href="/blog-category/new-membership-economy" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">New Membership Economy</a></li></ul></div>Thu, 25 May 2017 22:48:41 +0000OceanX436 at http://oceanx.comhttp://oceanx.com/content/video-recurring-revenue-conference-panel#comments4 Ways to Surprise and Delight Your Subscribershttp://oceanx.com/content/4-ways-surprise-and-delight-your-subscribers
<div class="field field-name-field-blog-image field-type-image field-label-hidden"><div class="field-items"><div class="field-item even"><div id="flexslider-10" class="flexslider optionset-default">
<ul class="slides"><li><img typeof="foaf:Image" class="img-responsive" src="http://oceanx.com/sites/default/files/blog/4waystosurprise.jpg" width="1070" height="346" alt="" title="" /></li>
</ul></div>
</div></div></div><div class="field field-name-body field-type-text-with-summary field-label-hidden"><div class="field-items"><div class="field-item even" property="content:encoded"><p>One of the biggest values provided by subscription is the delivery of daily wants or necessities to your doorstep. While people enjoy the convenience of receiving boxes regularly, brands and retailers that include delightful surprises in their boxes can build even stronger relationships with their customers.</p>
<p>Everyone likes getting something extra or having an unexpected gift show up at the door. It’s those little surprises that can set your subscription program apart from your competition. Most first-generation subscription programs focus on value, convenience, and replenishment, but the most successful ones use higher-level psychological elements such as the surprise factor to help extend the life of the relationship.</p>
<p>The best part is that adding the element of surprise does not have to be difficult. Just throw in a thoughtful or personalized product that your customer is not expecting, and the anticipation of it can keep customers looking forward to the next delivery.</p>
<h2>Building Better Relationships</h2>
<p>While it might seem obvious, it’s important to note that customers feel appreciated when a brand goes out of its way to do something special for them — even if it’s as simple as including an unexpected gift. Those surprises can form deeper bonds between customer and brand.</p>
<p>For example, Try The World is a subscription service that provides food samples from around the globe. One customer posted on Instagram when Try The World sent her a surprise box in the mail, saying she loved that the items were all from Portugal. “My girlfriends and I celebrated my 40th birthday in Portugal a few years back,” she said, “so this box reminded me of some great memories today.” A surprise gift with a personal touch, like this one, creates a positive connection between customer and brand.</p>
<p>It is more than just food brands that are surprising customers. A subscription box exists for nearly every product imaginable, from clothes (Stitch Fix) to beauty and makeup (Birchbox) to health and fitness (FabFitFun) and more. Sneaking an unexpected product into boxes for any of these industries can delight customers and keep them coming back for more.</p>
<h2>4 Tips for Successful Subscription Surprises</h2>
<p>Surprising customers does not have to be a difficult task, but there are a few things to consider:</p>
<p><strong>1. Keep financials in mind:</strong> This may seem obvious, but while every brand would love to give away a free and possibly expensive gift for every customer in every box, it’s simply not feasible. All companies need to factor in their business models and price points. Think about the margin potentially gained in lifetime value (LTV) as a result of the extra gift or surprise, then consider whether it will be financially worth the cost of the surprise. If the surprise can help keep a customer subscribed longer, it might be beneficial; however, if you cannot find any evidence that points to improving your bottom line or extending LTV, you will end up losing more money than you are earning.</p>
<p><strong>2. Stagger your bonus items:</strong> If you cannot afford to sneak a gift into each box, keep customers guessing by including a surprise only occasionally. They will never know when to expect something, and that alone can be enough to keep them interested in the next box. It could be on an anniversary or as a gift for subscribing for a certain length of time or even on a random interval.</p>
<p><strong>3. Personalize each gift:</strong> A free gift is useful only if it is suited for the individual receiving it. Fortunately, data makes it easy to study each customer and determine what he or she likes and does not like. When the surprise gift is something a customer truly loves, the bond is much stronger than it would be if the product was not useful or if there was no gift at all.</p>
<p><strong>4. Vary your deliverable</strong>: You don’t necessarily need to include a product as the surprise. Instead, you could send customers a well-timed personal email thanking them for their business or even pick up the phone just to thank them and ask about their last box. A proactive customer service engagement could also be the surprise that keeps people coming back for more. Plus, you may get the added value of direct customer feedback, which can help across multiple levels.</p>
<p>The subscription box industry is becoming more competitive by the day, so it is important that brands find ways to stand out among the competition. One of the easiest ways is to include small surprises, because sometimes even the simplest gestures help create the strongest bonds. Connect with an OceanX membership expert to learn more tips on subscriptions and the powers of membership at <a href="http://www.oceanx.com/request-demo">www.oceanx.com/request-demo</a>.</p>
</div></div></div><div class="field field-name-field-category field-type-taxonomy-term-reference field-label-inline clearfix"><h3 class="field-label">Category: </h3><ul class="links inline"><li class="taxonomy-term-reference-0"><a href="/blog-category/customer-success" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Customer Success</a></li><li class="taxonomy-term-reference-1"><a href="/blog-category/new-membership-economy" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">New Membership Economy</a></li><li class="taxonomy-term-reference-2"><a href="/blog-category/subscription-strategy" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Subscription Strategy</a></li></ul></div>Wed, 17 May 2017 23:57:48 +0000Jeff Miller426 at http://oceanx.comhttp://oceanx.com/content/4-ways-surprise-and-delight-your-subscribers#comments